Lithia Motors, Inc. ( LAD ), the auto dealership aggregator, has changed its capital allocation over the past two years. It has reduced the proportion that goes to acquisitions and increased the proportion for shareholder rewards.Robert F. Abbott has been investing his family’s accounts since 1995, and in 2010 added options, mainly covered calls and collars with long stocks. He is a freelance writer, and his projects include a website that provides information for new and intermediate-level mutual fund inve ...

The market expects Asbury Automotive Group (ABG) to deliver a year-over-year decline in earnings on higher revenues when it reports results for the quarter ended December 2025. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to ...

Core Viewpoint - Penske Automotive (PAG) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates in determining stock price movements, making it a valuable tool for investors [2][4]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in buying or selling actions that affect stock prices [4]. Business Improvement Indicators - The upgrade in Penske's rating reflects an improvement in the company's underlying business, suggesting that investors may respond positively by driving the stock price higher [5]. - Over the past three months, the Zacks Consensus Estimate for Penske has increased by 0.1%, indicating a steady rise in earnings expectations [8]. Zacks Rank System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of generating significant returns for top-rated stocks [7]. - Only the top 20% of Zacks-covered stocks receive a "Strong Buy" or "Buy" rating, indicating superior earnings estimate revisions and potential for market-beating returns [10].

Core Insights - The Jeff Wyler Automotive Family has acquired Midwestern Auto Group for a total acquisition value of $500 million, marking it as one of the largest franchise automotive transactions by a privately held company and the largest overall auto retail transaction in 2026 [1][4] Group 1: Acquisition Details - The acquisition includes 14 premium and luxury brands such as Ferrari and Lamborghini, significantly expanding Wyler's portfolio to a total of 64 franchises [1][5] - This transaction is noted as the second-largest luxury automotive retail transaction in the U.S. since early 2025 and ranks among the top three largest Midwest dealership transactions by total enterprise value [4] Group 2: Advisory Role - Dave Cantin Group served as the exclusive sell-side advisor to Midwestern owner Mark Brentlinger, facilitating a succession plan that took nearly two years to execute [2] - The advisory process involved collaboration with legal and wealth management teams to ensure the protection of Brentlinger's legacy [2] Group 3: Industry Context - Transactions like the acquisition of Midwestern Auto Group are exceptionally rare in the automotive industry, particularly for a single-site campus offering multiple premium and luxury franchises [2] - The deal is characterized as a "unicorn" luxury campus deal, highlighting its significance in private-to-private acquisitions within the U.S. retail automotive sector [5]

Core Insights - The sudden closure of the Zhengzhou Central Porsche Center has left hundreds of car owners unable to retrieve their deposits or obtain vehicles, highlighting a significant issue within the dealership network [1][2] - The actual operator behind the affected dealership is Dong'an Holding Group Co., Ltd., a major automotive dealer in Henan with total assets exceeding 6 billion yuan [1][2] Company Overview - Dong'an Group was founded in 1993 and is headquartered in Xinxiang, Henan, with over 30 years of experience in the automotive dealership industry [2] - The financial troubles of Dong'an Group have led to a crisis that has spread from Zhengzhou to other cities such as Guiyang and Xinxiang, affecting not only Porsche but also other brands like Volkswagen [2] Operational Impact - Investigations revealed that multiple dealerships operated by Dong'an Group in cities beyond Zhengzhou are experiencing irregularities, with only a few locations at the headquarters in Henan still maintaining operations [2]

Core Insights - Bonhoeffer Fund is strategically selling slower-growth firms while acquiring durable, faster-growing firms in temporarily depressed sectors, aligning with long-term growth themes [3] - The portfolio is diversified with a focus on banks, insurance, natural resource royalties, logistics, housing, and specialty finance, with new investments expected to yield a growth rate of 30-40% [3][6] - The fund's performance in Q3 2025 showed a gain of 1.3%, underperforming compared to major indices like MSCI World ex-US and S&P 500 [6][7] Portfolio Overview - As of September 30, 2025, the portfolio's largest country exposures are the United States (71%), Canada (11%), South Korea (7%), Peru (7%), and Greece (3%) [8] - The largest industry exposures include distribution (52%), real estate/infrastructure/finance (62%), and consumer products (7%) [8][11] Investment Themes - The distribution theme includes high-velocity firms in car dealerships and building product distributors, with a focus on inventory turns [11] - The real estate/construction/finance segment is driven by infrastructure programs and housing development, with banks meeting specific growth criteria [15][16] - Public leveraged buyouts (LBOs) focus on firms that create growth through acquisitions, benefiting from operational leverage [18][19] Case Study: Fairfax Financial - Fairfax Financial utilizes insurance float to finance a balanced portfolio, with a decentralized business model allowing for strategic acquisitions [38][39] - The company has shown significant improvement in underwriting discipline, with combined ratios declining from 107% to 91% since 2009 [38] - Fairfax's investment portfolio, valued at $67.4 billion, primarily consists of bonds (74%) and equities (26%), generating a historical return of 7.7% per year [40] Financial Metrics - Fairfax's return on equity (RoE) target is 15%, with a current cost of float at -3.2% per year [33][40] - The company has four levers for earnings growth: acquisitions, expanding underwriting, investment portfolio growth, and stock repurchases [41] - The expected growth rate for Fairfax is estimated at 7% per year, with a target share value of $3,225, representing an 88% upside from current prices [53][58]

This story was originally published on WardsAuto. To receive daily news and insights, subscribe to our free daily WardsAuto newsletter. Artificial intelligence is changing the way consumers shop for cars, and dealers who take advantage of AI can use it to make those consumers more satisfied. But that just scratches the surface of the impact AI can have on a dealership’s operations, industry experts told WardsAuto. From the showroom and service departments to used car operations, AI can give dealers new t ...

Core Insights - Kerrigan Advisors facilitated the sale of Arlington Toyota to Andy Mohr Automotive Group, marking the 39th Toyota franchise sold by the firm in the last decade and reinforcing its leadership in the auto retail sector [1][2][4] Company Overview - Arlington Toyota, established in 1983, is recognized as one of the highest-volume and most operationally efficient Toyota dealerships in the Chicago metro area, serving an affluent customer base [2][4] - Andy Mohr Automotive Group, founded in 1992, is one of Indiana's largest dealership groups and is expanding into the Chicago market with this acquisition [3][4] Market Dynamics - The sale of Arlington Toyota highlights the ongoing strength and desirability of top-performing Toyota franchises, with 92% of Toyota dealers expecting franchise values to either increase or remain stable through 2026, the highest sentiment among all brands for seven consecutive years [4][7] - Toyota holds a significant market share in the Chicago area, ranking as the 2 best-selling brand with an 11% market share, which is 88% higher than the national average [5] Economic Context - The Chicago metro area is a major economic hub, ranking as the third largest in the U.S. and home to 30 Fortune 500 companies, supporting a diverse economy and a population exceeding 9.4 million [5][6] Advisory Expertise - Kerrigan Advisors has established itself as a leading sell-side advisor in the auto retail industry, having generated over $10 billion in sales proceeds for clients since 2015, and is recognized for its conflict-free advisory approach [1][8]

Group 1 - Group 1 operates extensively across the U.S., with a strong presence in the Northeast, Southeast, Texas, and California, and is the 1 auto retailer in Texas [1] - The company has 324 new vehicle franchises and 259 franchised new vehicle dealerships, generating $19.9 billion in revenue last year [3] - Group 1 is a leader in the aftermarket sales segment, successfully adapting to the complexities of modern vehicles, including electric vehicles [2] Group 2 - The U.S. auto dealer market is valued at approximately $2.95 trillion and is projected to reach $3.68 trillion by 2030, reflecting a CAGR of about 4.5% [6] - The demand for personal vehicles remains strong, supporting a steadily expanding automotive dealership industry [7] Group 3 - In Q3 2025, Group 1 reported record revenues of $5.8 billion, a 10% year-over-year increase, and a non-GAAP EPS of $10.45, up 5.6% year-over-year [9] - Analyst Babcock sees Group 1 as having significant growth potential, trading at 8.8x forward P/E, below the dealer average, with a price target of $510, suggesting a 30% gain [10] Group 4 - Lithia Motors, another major player, has 450 dealer locations and reported Q3 revenue of $9.7 billion, up 5% year-over-year [14] - Lithia's strategic goal includes expanding luxury car services, recently acquiring two luxury dealerships generating $450 million in annual revenue [13] Group 5 - AutoNation operates 323 dealer locations and reported Q3 revenue of $7.01 billion, a 7% year-over-year increase [19] - Analyst Babcock highlights AutoNation's consistent operating performance and favorable valuation, setting a price target of $250, indicating a 27% potential gain [20]

This story was originally published on WardsAuto. To receive daily news and insights, subscribe to our free daily WardsAuto newsletter. LTA Auto Group, a division American Automotive Capital Partners, has acquired Golden State Nissan and Golden State Infiniti and changed the names to Nissan of Serramonte and Infiniti of Serramonte. The dealership acquisitions are the first of what American Automotive Capital Partners aims to be many, said T.J. Anthony, co-founder and CEO of AACAP. “We’re fundamentally f ...